Smelting changes

Smelting ores in arc furnaces without coal required for reaction - unrealistic. Adding coal as 3rd component - impossible (no 3rd input). Here is the solution: introduce Iron Mix, Copper Mix and Quartz Mix intermediate materials just like the Glass Mix we already have, all made in Industrial Mixer same way:
Iron Ore + Coal + Limestone -> Iron Mix;
Copper Ore + Coal + Sand -> Copper Mix;
Quartz + Coal -> Quartz Mix.
The arc furnaces process the Mixes alone, while Blast Furnaces II use additional Coal aside from the Mix (extra coal used just for heating there, and must be well worth 1.4MW the arc furnaces consume).
So the Arc Furnaces superior to BFII by reduction of coal consumption. In addition, recipes with scrap processing in AF should be more efficient by reducing Graphite consumption from 3 to 1 in recipes with scrap.
Also the throughput of recipes of making the Mixes should be buffed, so that single Industrial Mixer could supply multiple furnaces.

Went here to make a similar suggestion. As you said, the iron isnt just melting from the ore, it is being reduced by the carbon monooxide that is there from burning the coke. I would add to your suggestion, that in real life the iron mix you describe isn't just mixed, it's iron aglomerate and has its own facility in the blast furnace area. The iron ore is blasted with heat to aglomerate into iron pellets that are then mixed right at the blast furnace with the limestone and coke. Alongside adding cokery for coke (just like real life it would have higher thermal efficiency than coal), adding the aglomeration building would be interesting.

(cont.) But the biggest issue with smelting as it is now that I see is the arc furnance itself. In reality it just can not make iron from raw ore. And even if you would add coal as a smelting component, you would just be burning the coal and the chemical reduction of iron couldn't run because of the shape of the furnance. Blast furnaces are tall for exactly this reason, so that the reaction can run the whole time the iron mix moves from top to the bottom of the furnance with varying pressure from the weight of the material inside. The most advanced way of smelting iron could be direct hydrogen reduction smelting that is being developed in Sweden ( see https://www.hybritdevelopment.se/en/a-fossil-free-development/direct-reduction-hydrogen-pilotscale/ ). This would be realistic and the addition of hydrogen to the smelting process would make it very interesting from the gameplay perspective as well given the sour water slag contract :) .